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Report No. 47

15.61. Restriction on unnecessary examination of tax-payers.-

We should also refer to the Report of the Working Group on Direct Taxes1 of the Administrative Reforms Commission as to unnecessary examination of tax-payers:-

"In this connection, a suggestion was made to us that a provision should be made in the Income-Tax Act on the lines of section 7605(b) of the Internal Revenue Code of 1954 of the United States of America, reproduced below, which limits the number of times the account-books could be called for and examined-

(b) Restrictions on Examination of Tax-payers.-No Tax-payer shall be subjected to unnecessary examination of investigations, and only one inspection of a tax-payer's books of accounts shall be made for each taxable year unless the tax-payer requests otherwise or unless the Secretary or his delegate, after investigation, notifies the tax-payer in writing that an additional inspection is necessary."

We should like to express our agreement with this view.

1. Report of the Working Group on Central Direct Taxes Administration (Administrative) Reforms Commission) (January, 1968) (pp. 24, 25, para. 2.25).

15.62. Paucity of prosecutions.-

In the Report of the Working Group1 of the Administrative Reforms Commission, the following observations have been made as to prosecutions:-

"The performance of the Department has been so poor that the Public Accounts Committee was compelled to remark as follows in its 21st Report (1963-64)-Third Lok Sabha-

In para 7.12 of its Report, the Direct Taxes Administration Enquiry Committee observed that though the Direct Taxes Acts provide for prosecution and imprisonment in the cases of concealment of income, not a single person has been convicted for evasion during the last ten years, and recommended that unless it was brought home to the potential tax evader that attempts at concealment of income would not only not pay him but also actually land him in jail, there could be no effective check against evasion. The Committee are not a little surprised to find that even though this recommendation has been accepted, Government sent for prosecution not more than one person in whole of the country during 1961-62 and that case too was compounded."

We understand that the question has been actively taken up and so we do not propose to say anything more about it.

15.63. Tax laws-abetment by creating false vouchers.-

It has been suggested that1 the scope of the term 'abetment' in tax matters should be widened to include the creation of false vouchers, accounts and other records which may facilitate tax evasion by any other person. We think that under the definition of 'abetment'2 in the Penal Code, such acts would be covered, provided, of course, it is proved that the person charged has thereby facilitated evasion.

1. Suggestion of a Ministry of the Government of India.

2. Section 107, clause thirdly, India Penal Code.

15.64. Supply of material for committing a crime how far constitutes abetment.-

The question is allied to the question how far supply of tools or materials constitutes abetment of an offence. Though it is not possible to make a very categorical statement of the position in England about certain matters of detail, the case law1 furnishes sufficient ground for putting forth a view that a person who, with intent to facilitate a crime, supplies materials or tools for the commission of the crime, 'aids its commission'. The distinction between misdemanour and felony has been abolished in England2, and the provisions as to accessories before the fact are of no legal significance now.

Assistance in the crime even at an earlier stage will suffice, as where the accused assists someone who subsequently utters forged cheques to open a bank account in a false name3. One man may abet another by helping to set the stage even before the victim has been found. "If a man helps another in preparation for crimes of a certain nature with the intention that the other shall commit crimes of that nature, he may abet those crimes when they come to be committed4".

1. See paras. 15.65 to 15.67, infra.

2. The Criminal Law Act, 1967 (Eng.).

3. Thambiah v. R., 1966 AC 37: (1965) 3 All ER 661 (665) (PC).

4. Thambiah v. R., 1966 AC 37: (1965) 3 All ER 661 (665) (PC).

15.65. Whether a person who knowingly gives assistance, but hopes that the crime will not be committed is guilty as an abettor, is a question on which the authorities in England are not easy to reconcile. But this much is clear, namely, that if a person intentionally supplies materials for the commission of a crime, he aids and abets the crime.

As Devlin J. said1 in a case which is often cited:-

"A person who supplies the instruments for a crime or anything essential to its commission aids in the commission of it, and if he does so knowingly, and with intent to aid, he abets as well, and is therefore guilty of aiding and abetting."

1. National Coal Board v. Gamble, (1959) 3 All ER 200.

15.66. It was observed 200 years ago1, that no man ought to furnish another "with the means of transgressing the law, knowing that he intends to make that use of them".

1. Lightfoot v. Tenant, (1796) 126 ER 1059 (1062).

15.67. The controversy, at present, is only as to whether knowingly facilitating the commission of a crime ought to be sufficient for complicity, if a true purpose to advance the criminal end is absent. There has been a difference of opinion as to the criteria that should measure criminal liability in this respect. According to one view, the abettor must have "a stake in the outcome". According to another view, however, conduct which knowingly facilitates the commission of crimes is the proper object of preventive effort by the penal law (if there is no affirmative justification for that conduct).

15.68. Position in India.-

The position in India, in this respect, should be regarded as more certain than in England, because the Indian Penal Code not only provides1 that a person who "intentionally aids, by any act or illegal omission, the doing" of anything, abets it, but also2 makes it clear that whoever "either prior to or, at the time of commission of an act, does anything in order to facilitate the commission of that act, and thereby facilitates the commission thereof", is said to "aid the doing of that doing". The Code3 has, further, a specific provision that to constitute the offence of abetment it is not necessary that the act abetted should be committed.

1. Section 107, clause thirdly, IPC.

2. Section 107, Explanation 2, IPC.

3. Section 107, Explanation 2, IPC.

15.69. It is also relevant to refer to a Supreme Court case1 in that the point was considered how far the acquittal of a person alleged to have committed the offence in consequence of abetment bars the conviction of abettor. It was stated that it cannot be held in law that a person cannot even be convicted of abetting a certain offence when the person alleged to have committed that offence in consequence of the abetment has been acquitted. The question of the. abettor's guilt depends on the nature of the act abetted, and the manner in which the abetment was made. The offence of abetment is complete when the alleged abettor has investigated another, or engaged with another in a conspiracy to commit the offence.

It is not necessary for the offence of abetment that the act abetted must be committed. It is only in the case of a person abetting an offence by intentionally aiding another to commit that offence that the charge of abetment against him would be expected to fail when the person alleged to have committed the offence is acquitted of that offence. It is only in this narrow circumstance that the abettor can be exempted from his guilt, otherwise, under the Indian law, for an offence of abetment, it is not necessary that the offence should have been committed.

1. Jamuna Singh v. State of Bihar, AIR 1967 SC 553 (Raghubar Dayal, J.).

15.70. A mere giving an aid by itself will not, of course, constitute an abetment of an offence1, if the person who gave the aid did not know that an offence was being committed or contemplated. The intention should be to aid an offence or to facilitate the commission of an offence2.

1. Ram Nath v. King-Emperor, AIR 1925 All 230.

2. State v. Abdul Aziz, AIR 1962 Born 243 (Case under the Import and Export Control Act).

(The case went on appeal to the Supreme Court. But this point was not disputed).



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